leaving you with a winner. see you for "street signs" tomorrow. "closing bell" beginning right now. hi, everybody. we enter the final stretch. welcome to "the closing bell." i'm maria bartiromo at the new york stock exchange. as we hurry toward the edges of the fiscal cliff, this market holding its breath. but holding up. >> yes, so far. technology one of the few bright spots with apple rebounding after that huge decline we saw yesterday. its worst day in four years. it's got everybody on wall street scratching their heads trying to figure out what the

problem is with apple. at any rate, here's where we stands right now. sort of a meandering day for the markets. some economic data out this morning. the market responding to that. then a sideways move after that. the nasdaq benefitting from the rebound in technology yesterday. up 11.5 points on the thatnasda. the s&p is also trading higher. there it is. up 2.5 points on the s&p. >> meanwhile, bullish sentiment at an eight-month high right now. equity allocation is still at the lowest level of the year according to the american association of individual investors survey that was out this weekend. stock in a wait-and-see mode. totally understandable until these fiscal issues are resolved. >> but don't just sit on your hands. there is money to be made if you can find the opportunities. let's find out where they are in

today's "closing bell" exchange. everybody is in the water here. scott is not there yet. jeff cox, the market is still waiting on the fiscal cliff. they're still sort of held accountable for that right now. yet, the investors' sentiment numbers are the highest in a while. what do you make of that? >> this isn't just the most hated stock market rally ever as some have suggested. this might be the most hated stock market ever. let's just talk about some quick numbers. market trading volume down 19% this year. we've seen $125 billion come out of equity based mutual funds. $300 billion go into bond funds. really, no appetite for getting into this market in terms of the

volume. why? i think there's a general distrust of the markets. fiscal cliff and all of the other stuff. great story on the front page of wall street journal today talking about portfolio pumping. another example of investors thinking they're not getting a fair shake out of the stock market. >> larry, you call that complacency, don't you? >> that's right. i'm actually shocked that these investors appear to be asleep at the switch in light of the fiscal fiasco looming in less than a month. you would think investors saying their concerns would be running for the hills or at least buying portfolio protection to protect themselves against potential disaster. we see the vix very low. they're not taking the type of defensive, decisive action. if we get a downgrade and if this happens, it will be terrible for the market. that's what's potentially on the market, if we don't make a deal in washington. >> scott, let me ask you again how you want to allocate capital then in that environment. i know george young is with us again, joining the conversation.

i want to ask you the same question. go ahead, scott. how are you investing right now? >> maria, i think the best way forward is the way it's worked since the bottom of the market in 2009. risk assets are where it's at. the fed is very supportive. the consumer is back and engaged. housing is getting better. the fiscal cliff is actually constructive from the standpoint it causes people to come together and compromise because going over the cliff while we may do it for a short time period is not beneficial to anybody. it hurts everybody. >> so risk assets being, what, technology? what does that mean, technology? >> not necessarily. we would stay with dividend payers. we would also dip our toe into europe into some very high-quality, multicountry stocks there. mostly on consumer discretionary stocks as well. >> george, we haven't forgotten you yet. scott, i have a question for

you. just noticed today france and germany's stock markets hit 52-week highs. we're still wringing our hands over the debt crisis, and the equity markets are hitting new highs for the year. is it too late to get into those markets? >> i don't think so, bill, at all. all the european markets are up for the year except portugal, which is up slightly. even greece is up year to date. i don't think you're too late on that trade at all. in fact, i think, quite frankly, the structural changes that are happening in europe could produce growth for many years come. >> where are you putting money to work, george? >> the fiscal cliff is sort of the uncertainty du jour. people are always worried about next uncertainty. you need to blow past that and think about where the next good stocks going to be, how can i invest, how can i participate? taxes are likely to go up, but this is a lot of rattling. both sides of the aisle would come together. they'll figure out what's best.

at the end of the day, they know they have to help the little guy, the consumer. pool corp. sells everything but the water. they're suppliers for the pool industry. we think they'll grow at 18%. they have very little debt. it's like an annuity. all the pools in this country are seven years old. we love that kind of stock. >> bill, i take issue with the idea this is just saber rattling. if dividends triples, that's going to have a meaningful change in the way people allocate capital going forward. we're already seeing it with special dividends this year. this is a significant change. >> this is not necessarily just, you know, the upset du jour. this can change the economic landscape in 2013 and beyond. >> that's not going to happen. >> what if we wake up on january 2nd, we go over the cliff -- >> why do you say it's not going to happen? >> human nature is to focus on all the worst possibilities. call me an optimist, but i think

things are going to get better. the economy is strong. it's going to get stronger. >> what evidence do you have these guys are not just going to go over the fiscal cliff? we heard tim geithner on this program yesterday when steve asked him, look f you don't get what you want, do we go over the fiscal cliff? he said absolutely. >> he said he would do it! >> what happens when we wake up january nd, we go over the cliff, and the world doesn't end? >> that is so irresponsible. >> you have to be a long-term investor. long-term stocks have outperformed bonds. >> with all do respect, george, are you one of those come play september investors larry is referring to? >> i'd say we're opposite of that. we never take anything for granted, but we bet accordingac. bonds are trouble. a lot of people are going to lose a lot of money in bonds. you have to be prepared for that. interest rates are going to go up. dividends are going to continue to increase. the economy in this country is strong. it's going to get stronger.

>> even at 44% dividend tax? >> it's not going to go that high. >> if we go over the fiscal cliff, it does go that high. it goes to 44%. >> no, no. don't think the worst. >> less than a month, it goes there. >> i want to think like an optimist, but i'm not going to put rose-colored glasses on. i see what's going on. >> there's no safe haven for capital or capitalists. you have to take some chances. >> my question here is what happens if january 2nd comes, we go over the fiscal cliff, and the world doesn't end and we kind of just get acclimated to this whole thing of just going forward with these higher tax rates? what do you do then if you get stuck in some of these positions? i'm looking at a couple other numbers. cash, $2.6 trillion. i saw before i came out here that corporate bond issuance

went over. i think there are a lot of ramifications. i think just to dismiss this is really inviting trouble. >> think about all the corporate bond issuers out there. they're taking a window of opportunity because that window is going to close. they're running for the hills had to make sure they get all the bonds issued they can. >> if we go over the cliff, the cbo says we're going to be in severe recession. that's not business as usual. >> it's a contrarian fact that when people hate stocks this much, that's probably the time you want to own them. fiscal cliff or not. >> all right. i'm also looking at fundamental indicators too. if we go into recession, i think that's priced into this market. we'll be watching, gentlemen. thank you very much. we appreciate it. we have 50 minutes before the closing bell sounds for the day. a market that's up just about 11 points on the dow industrials. very revealing interview. apple ceo tim cook talking about steve jobs' words of wisdom for running his company. listen to this. >> he told me on a couple of

occasions before he passed away to never question what he would have done. never ask the question what steve would do to just do what's right. >> up next, we're going to find out if apple would be in better shape if mr. cook started asking, what would steve do? we'll get to that coming up. then i'll talk exclusively with the ceo of fedex. fred smith is with me on how the shipping giant is bracing for a possible fall off the fiscal cliff. it's all later on "the closing bell." stay tuned.

welcome back. take a look at apple here bouncing back today, almost up 1% after that big decline yesterday. that was the single biggest loss in four years. the stock is still down better than 20% from the highs, putting a lot of scrutiny on this company right now. >> in his first interview since taking over apple, ceo tim cook spoke exclusively with nbc's brian williams. here's a part of that interview. listen. >> how are you not steve jobs? >> in many way, one of the things he did for me that removed a gigantic burden that

would have normally existed is he told me on a couple of occasions before he passed away to never question what he would have done. never ask the question what would steve do, just do what's right. >> but given the recent slide in the stock and missteps like google maps, should cook start asking is what would steve jobs have done? max wolf of green crest capital says tim cook could help himself by channelling more jobs. nicolas carlson makes the cay that in some ways tim cook is even better than steve jobs. i think we have a disagreement going here. max, you first. why can't we just allow apple to change and become tim cook's company? >> i think it has become tim's. that transition occurred prior to the passing away of steve jobs. i think it's healthy. i think he should stand on the shoulders. everybody in the tech world has something to learn from jobs.

i think standing on the shoulders of steve jobs is great idea. i think wearing a dead man's pants to work is creepy and a terrible idea. he has to be different. he can't try to clone apple. after all, what makes apple different from all the people who want to be apple is it does its own thing. mr. cook has to follow in that great tradition. >> mnicolas, how does he do tha? what kind of business experience does tim cook bring that perhaps steve jobs didn't? >> first of all, tim cook has done a lot of things that make apple a more human company, which is important for the brand in the long run. there's been a lot of mess with foxconn in china. he's paid apple retail employees more money. that's good for apple and the economy. finally, he talked today about bringing over more manufacturing of macintosh computers in the united states. that's good for everybody. >> i think people will take issue saying tim cook is better than steve jobs, nick, don't you

think? >> it's certainly hard to say anybody is better than steve jobs. that's not really an option, whether or not steve jobs continued to be the ceo of apple. i think tim cook has done a good job. for him to try to be steve jobs, to try to be a product visionary would be a big mistake. his real skill is optimizing supply chains and running apple's massive operations. he's done a good job of really focusing in on who can be the next steve jobs. that's johnny ive. he's the person who designed all the hardware at apple. now he's in charge of the way everything looks and feels. after steve jobs, there's a natural fight between who's going to become that next person. you have to give tim cook credit for going with johnny ive. >> at the end of the day, people want to know, is the innovation alive and well at apple? are they going to continue to come out with these products that the world wants to sfwhie max, what do you think?

>> there's a possibility. they only do the big innovation. steve jobs had many and huge failures. he's not remembered for those. he's remembered for the successes. you don't get the successes unless you take the big chances. lately, we've seen them do a lot of what wall street wants vis-a-vis margins but a lot less of risk taking. they have to do that to keep being the apple that commands the premium on the price of all their goods that they've historically had and that ironically the markets rely on them to have in order to get themselves to price forecast for the share prices above $600. >> they're still trying big, new, exciting things. over the summer, we saw patent filings for things similar to google glass. they're working on these things. the difference between apple and google is they're not public about it. we don't know what they're working on other than these p patent filings. trust me, they're working on big, new, exciting things. even wearable computers. >> let's hope. we haven't seen them though. maybe. >> it just occurred to me, we

talk about tim cook versus steve jobs and is the company different and how is it different and all that. is it possible, max, that shareholders think they are still investing in steve jobs' apple rather than tim cook's apple? >> absolutely. >> is that why we've seen this 23% decline in the stock recently as some of that is starting to dawn on them? >> absolutely. i'll do you one better. it's a great question. i think analysts still think they're forecasting and following steve jobs' growth. the bad news is that it's the wrong model. that era has ended. there's lots of exciting things to do. the story is not over. the future is potentially very bright. folks need to move away from maintaining the margin and benchmark everything against steve jobs. the margin is not defensible. >> it's snot just steve though. it's the talent steve attracted and whether or not thatt atalen is leaving or if it's still

there. what are you shaking your head about? >> i think johnny ive is certainly as much of a talent magnet as steve jobs. this person has an aura about him. i think a lot of people at apple and surrounding apple are very exciting when tim cook did a good job of selecting johnny ive instead of scott forestall. you hear reports of people applauding that johnny is the man now. he's going to run the design over there. it's big news. >> all right. we'll leave it there. >> scott wasn't so popular either, which was part of the reason for the applause. >> guys, thanks. appreciate it. catch the full interview with apple ceo tim cook tonight 10:00 p.m. eastern on nbc's "rock center." >> looking forward to that. as we head toward the close with about 40 minutes left on the trading session, losing altitude here. >> how about zynga? the company known for its farmville game, of course. the company is now betting the farm on a different kind of game. look at this. >> tell you what, fred.

we'll play for a nickel if you want to bet. >> a bet? bet? bet, bet, bet, bet. >> oh, yeah. is it moving to gambling? just what this beaten-down stock needs. after weeks on the run if authorities in belize, anti-virus software pioneer john mcafee has finally been caught, but you will not believe where he was found and how he was actually located. we have details on this bizarre story that gets more bizarre all the time. coming up. [ male announcer ] when a major hospital

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welcome back. check out zynga. the shareholders getting good news today after a tough year. the stock rallying after the company filed for gaming license in nevada. julia boorstin with the story on this big bet. over to you. >> investors are clearly relieved to see zynga is trying to make money from online gambling. getting a game license in nevada is a key first step. but a much bigger hurdle is the fact that online gambling is illegal in the u.s. zynga could be sitting on a gold mine if even a few percent of its monthly poker players gamble. even if online gambling does become legal, all the big casino owners would pose some very steep competition. bill and maria.

>> indeed. julia, thank you. despite today's gains, shares of zynga still plummeting this year, losing some 70%. does this news change the outlook? let's start talking numbers on zynga today. on the technical side, mark newton with grey wolf execution partners. on the fundamental side, paul hickey. does this make you want to buy the stock? >> not really. the biggest hang-up is the valuati valuation. for growth stocks in general, when a valuation isn't always a hang-up, but the problem with zynga is by most metrics, its growth is either slowing or declining. it doesn't seem to justify that high valuation. >> all right. mark, let's look at the chart. what does it tell you? what about this button-hook rise? >> technically, bill, the stock it starting to look better to me

here, actually. if you look over the last nine months, the stock has dropped over 86% from the highs back in march. now this recent down trend has given way to more consolidation over the last few months. if anything, the recent trend is starting to resemble what a lot of technicians would call reverse head and shoulders pattern. a close here would represent new ten-week closing highs. my thinking is the stock can move higher, take out november highs and get up to 330. that would be almost a 29% rise from current levels. >> the stock does seem to be rounding out a bottom, but the big hang-up is the pop today on volume. we saw a similar move back in january when the stock jumped about 15% when the company said they were going to explore looking into online gambling. investors who bought in on that news, which is a similar type of news as today, have lost 75% while they waited. i'd like to see more confirmation in the charts and on the fundamental front before

we got very attracted to zynga. >> well, look, the stock has come back from 16 down to $2. if you've ridden this stock down, it looks like you've been dealt a bad hand. just recently with the technical improvement improvements, my thinking is it looks like the board is filling up. you certainly don't want to fold here. my thinking is the stock can move higher. >> nothing to say to that, paul? >> yeah, i mean -- >> has he beaten you? do we give the victory to mark? >> if you've been holding it from ten to two, what's the point in selling it? >> i've said it before, i'll say it again, you can't break your arm falling out of a one-story window. >> and the one thing in zynga's favor, maybe, is the one that have been holding up the best as far as their growth is the online poker segment. that's seen the slowest deceleration in users. you know, that could be something for it. it's a stock that we'd stay away from still. >> all right. very good. thank you, both, for your thoughts today on zynga.

see you later. maria. >> 30 minutes before the closing bell sounds for the day. the market is fractionally better on the session. the dow jones industrial average up 13 points here. up next, we're talking potential fallout from the the fiscal cliff with the head of economic bell weather fedex. fred smith will join me straight ahead. we'll get into that and a lot more. stay with us. later, the ceo of the company that owns luxury brand gucci is warning sales could fall off if we don't get the fiscal cliff in order. hear from him later. tdd#: 1-800-345-2550 when i'm trading, i'm totally focused. tdd#: 1-800-345-2550 tdd#: 1-800-345-2550 and the streetsmart edge trading platform from charles schwab... tdd#: 1-800-345-2550 gives me tools that help me find opportunities more easily. tdd#: 1-800-345-2550 i can even access it from the cloud and trade on any computer. tdd#: 1-800-345-2550 and with schwab mobile, tdd#: 1-800-345-2550 i can focus on trading anyplace, anytime. tdd#: 1-800-345-2550 until i choose to focus on something else. tdd#: 1-800-345-2550 all this with no trade minimums. tdd#: 1-800-345-2550 and only $8.95 a trade. tdd#: 1-800-345-2550 open an account with a $50,000 deposit,

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we are now just 25 days and counting away from the fiscal cliff, but are we any closer to a deal than we were yesterday? eamon javers is in washington making a career out of this story. he's got the latest on the negotiations. >> hi, bill. the battle for public perception here in the fiscal cliff fight continues today. the president visiting a middle class family in northern virginia who he said would be hurt by tax increases if those come to pass at the end of this year. the president saying that republicans simply need to come to terms and a deal with him. take a listen to what the president had to say out in the

living room of this family in northern virginia. >> i'm not going to sign any package that somehow prevents the top rate from going up for folks at the top 2%. but i do remain optimistic that we can get something done that is good for families like this one and that is good for the american economy. >> so, bill, the president using the power of the bully pulpit there and image making. it's the power the president has to shift the debate here. republicans don't seem to have caved in just yet. we're going to have to see whether or not there's a deal. i think the most encouraging sign for those people who want to see a deal is that the president and the speaker of the house had a phone call yesterday, and the contents of that phone call haven't leaked out yet. that's a sign that there's a genuine negotiation going on and offers are not being rejected out of hand. last week we saw a lot of leaking after proposals. this week, not so much.

maybe there's something behind the scenes. >> you have a quizzical look on your face. >> i was listening to the president. was he referring to the debt ceiling there, eamon, when he said, i'm not going to allow higher rates for the -- >> what the president is saying is what he's been saying all along. the deal is going to have to include higher rates. he will not sign anything that doesn't include higher rates on the wealthy. >> that's what i thought he said. >> he's using the backdrop of the middle class family to make his point. the republicans, in his view, are holding the middle class, these people, hostage in favor of the rich. that's a point the white house wants to hammer home. that's why you see the effort o find a visible backdrop to do that. >> and harry reid named a number today. 38.5%. >> they talk about the clinton tax rates and say how good the economy was under the clinton years, but it's not entirely

clear that raising taxes is going to create a great economy this time around. >> thank you so much. we go from party line to the front lines on the impact of the fiscal cliff's mess. fedex ceo fred smith was among the ceos who met with the president yesterday. he's been outspoken on the issue of corporate taxes as well as jobs, making headlines saying it's a myth that raising tax rates will kill jobs. let's talk with fred smith right now in a cnbc exclusive about that and more. frank, good to have you on the program. welcome back. >> thank you very much, maria. always good to be here. >> good to see you again. let's start with the fiscal cliff issue. when it comes to higher taxes, you seem to disagree with house speaker boehner when he says raising taxes on the highest earners will hurt jobs. can you elaborate on that? >> i think what the speaker is saying quite correctly is you don't want to increase taxes on the job creators. the problem here is the 1986 act that equalized corporate and personal rates. so the most important thing is

to have an internationally competitive corporate rate of 25% and a territorial tax system and then individuals who have been filing their businesses as s-corporations or pass-through corporations can incorporate and get that lower rate. they can negotiate on the individual rates. >> so you don't think the ordinary income, then, the 39.6% that we're talking about, in that case, would apply to small business. they would fall under the corporate tax rate. >> yes, exactly. people forget that until 1986, corporate and individual rates were separate. a big part of the '86 act was to equalize them. there's a big difference between 2012 and 1986. only 17% of our economy was related to trade in '86. last year in 2011 it was 32%. so we're now the highest corporate tax rate of any

industrialized country in the world, and only chile has a worldwide corporate tax system like we do rather than a territorial system. >> so you're really talking about the corporate rate having the big influence here. you know, a lot of talk recently on wall street and from the investor community that the dividend tax, the capital gains tax is also going to be quite impactful in terms of money moving throughout the kpi. what's your take on that? >> well, i completely agree with it. i mean, if i were the czar and could wave a magic wand based on my experience, capital gains taxes would be, say, 25%. they would go to zero at the end of five years and apply to every investor, whether it was a tax-free pension funds and it would stop a lot of this speculation and churning of stock. and dividends, people forget, are already taxed at 35% at the

corporate rate before your return of capital represented by dividend is taxed at 15%. and as of january the 1st, an additional 3.8% to fund the new affordable patient act or so-called obamacare. >> all right. so what's important to you in terms of the impact on business and the economy, then, are corporate rates and investment related rates. not necessarily ordinary income tax. you make very good points there. let's talk about job creation. you've said that jobs in the u.s. are produced by capital investments and equipment in software, not those marginal tax rates. is that the argument? is that why you feel that those are so important in terms of changing the tax code? >> sure. i gave a speech today at the economic club. i put up a chart that shows the relationship of private investment and equipment in software. it looks like railroad tracks.

residential investment and government infrastructure, which is way down from historical levels, and business structures investment, that's important, but the locomotive that pulls our economy is investment in equipment and software. whether it's for an oil cater in the basis or a high-tech start-up buying servers and routers and things of that nature. it's our reduced level of capital investment that's produced our low gdp growth rates and our high unemployment. and high tax rates at the corporate level worldwide are directly related to high unemployment levels. you've got to stimulate investment in the united states and a lower corporate tax rate and a so-called territorial system where you don't tax profits made, say, from selling disposable diapers in china to chinese citizens.

has to pay a tax to come back in the united states. >> let me get your take, fred. everything you say makes a lot of sense. yet, here we are on the edge of this fiscal cliff. we're not sure what will happen. many people predicting we'll go over the cliff. if we go over the cliff and the automatic spending cuts take effect and the tax increases take effect, what do you think happens to the economy? >> well, at the brt meeting that you mentioned, where the president was nice enough to come over, the question was asked, if we go over the fiscal cliff, how many businesses in this room will reduce capital investment? remember, i just said -- and it's very demonstrable that capital investment is what drives gdp growth rate and job creation.

that tells a story right there. if we go across the fiscal cliff, we will have an economic contraction or slow down at best. >> how are things looking right now ahead of the holidays? i'm sure your company is real busy, fedexing gifts. what are your expectations for this holiday season? >> well, you know, the 300,000 wonderful teammates of fedex are working very hard. we publicly forecast a couple weeks ago that on the 10th we would move 19 million shipments through our network. that's up about 11% year over year. e-commerce is causing a significant amount of growth. retail sales are going to be up some place in the 3.5% and 4%. we think absent going over the cliff and absent tax reform,

u.s. gdp around 2% next year. worldwide, about 2.5%. >> real quick, we have to ask you your plans. you had said at some point you would leave the ceo role as soon as 2013. is that still in the cards? what's the succession plan? >> well, we have a strong team at fedex that manages the company. the strategic management committee of nine people. lots of people that can do my job without missing a beat. i don't have any plans to go any place in 2013. we're having a good time. if i were incapacitated, we'd probably upgrade the ceo with a strong executives that we have at fedex. >> so you're planning to stay right there? >> at least for a while. >> good for you. fred, good to talk with you. we appreciate your time. >> thank you for having me. >> shareholders will be pleased with that answer. see you soon, fred. >> thank you. >> the market is rallying while

you guys are talking. >> 32 points higher. >> interestingly, the day before we get the jobs number. also, one of wall street's top strategists will be joining us with his 2013 market outlook. he's bullish on three specific sectors. we'll name name when is we come back. >> how about the fact that a third of americans believe now is a good time to invest. do people with money in the market agree with that sentiment? the surprising results of all of america economic survey coming up. ♪ mom? dad? guys? [ engine turns over ] [ engine revs ] ♪ he'll be fine. [ male announcer ] more people are leaving bmw, mercedes and lexus for audi than ever before. take advantage of exceptional values during the season of audi event.

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so 2013, just a few weeks away. the markets are in the green for this year so far. it's been a bumpy ride lately, as we all know, amid the fiscal cliff uncertainty. so how should you position yourself and your portfolio for the new year? >> that's the question. let's bring in scott rand with a first-on look at their 2013 outlook. scott, good to see you. thanks for joining us. >> thanks, guys. >> so what do you think will be the growing areas of the economy and the stock market? let's first look at the stock market. what do you think will be the 2013 winners? >> well, maria, i tell you right now we're focussed on three sectors. consumer discretionary, materials and technology.

industrials are starting to look a little better, but we're even weight those right now. this could change during the year, but coming into 2013, i think those three look pretty good. >> why those? what's that tell us about the nature of the recovery in this economy right now? >> well, you know, bill what we're trying to do, we don't want our clients overly defensive here. we've been trying to get, you know, some cash put to work on these pullbacks. we don't want them overweight health care and staples and utilities and things like that. our belief is that we're going to see a better economy in 2013. fred smith just said they're expecting 2% gdp. we're expecting a little bit better, 2.5%. i think the global gdp is going to be a little better than it was in 2013. i think we're going to see better consumer confidence, better business confidence, better investor confidence. so if you think that's the case, you need to be in those sectors that are going to benefit from a better economic environment. those are three sectors right there that are going to. >> does that hinge on whether or

not we go over the fiscal cliff? in other words, if we go over the cliff and begin the year in a rough spot because of these spending programs that were cut and the higher taxes, do we have to first come out of that or not? >> well, you know, maria, my belief is we're not going to go over the cliff. i think that's likely to happen there is we see a little bit of taxes increased on a narrow number of people, a little bit of spending cut on a narrow number of industries. we move on from there. now, if we do roll over the cliff, of course the economy is not going to be knocked off the rail right away. it's going to take a little bit of time. but i think the market would have a negative reaction. you would have every ceo like fred smith, like the people that were in the room with him earlier today, coming out and saying, hey, we're slashing employees. we're not going to do any capital investment. i think the politicians would quickly panic in that situation. at the very least, band-aid it, kick it down the road, everything retroactive back to january 1st.

>> the fed has been taken off the front page lately because we're all wringing our hands over the fiscal cliff. there is chatter out there we're going to hear from the fed next week, maybe yet another round of fiscal stimulus and another qe-4. whatever it's going to be, the fed this year providing lots of liquidity. the market went higher in many cases, even though the fundamentals didn't justify that. are you hanging your hat on more fed action in 2013 for some of these growth opportunities? >> i think not only is the fed going to be in buying the mortgage-backed securities, but after the one program fades here at the end of the year, i think they could very well just be back in buying straight treasuries as well. i think that our central bank and every major central bank around the world is going to be providing a ton of liquidity in 2013. i don't think they're going to back off at all. i think employment -- unemployment is going to work its way a little lower next year. maybe we're at 7.5 at the end of the year.

these central bankers, we're going to have the wind at our back from the central banks for a long time. a ways through 2013. >> so it's more don't fight the fed. got to be in equities then if that's the case. >> i think that's part of it, maria. you have to remember, corporations are making money. besides the fed, we have low inflation. we have some things that are in our favor. i think that's going to continue. now, this growth that's going to be modest growth, modest inflation. i think stocks can do okay in that. they're not going to surge in that. certainly, we've had a good year so far. if we finish anywhere near current levels, we'll have had a great year. i think we're going to have a pretty good next year. i think we're going to end at 15.25, 15.75. that could be a little conservative. if china bounces back quicker than we anticipate, or if europe flattens out. we're optimistic next year. we want to make sure our clients

are in this market. >> scott, good to have you on the program. >> all right. thanks, guys. >> you know, he's not alone. lots and lots of analysts are coming out with their forecasts for next year. pretty bullish. >> even morgan stanley, right? >> yeah, for once. all right. heading toward the close here with about 12 minutes left. the dow hanging on to a gain of about 30 points. >> the situation with anti-virus software pioneer john mcafee is going from strange to surreal. he's now in custody. now reportedly has had two heart attacks. we're going to tell you the latest on this bizarre and evolving story. also, the ceo of accounting giant recently met with president obama. he say miss other ceos in that meeting agreed the tax rates for the wealthy have to rise as part of any fiscal cliff deal. he joins us exclusively later on "the closing bell." stay tuned. [ male announcer ] this december, remember --

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one of the most bizarre man hunts in recent memory is coming to an end in central america, we think. wealth editor robert frank has the latest details on the arrest of john mcafee. >> yes, bill, it's coming to an ends. we just learned john mcafee has been taken to the hospital in

guatemala. this follows news the former software tycoon was about to be deported to belize to face questions over a murder. let's bring everyone up to speed. mcafee has been on the lam for three weeks after the murder of his american neighbor in belize. belize police are seeking him for questioning. this week he fled to guatemala in hopes of finding safety and political asylum. his request for asylum was denied. police announcie ining today th going to fly him back to belize. he's about to be taken to the hospital amid reports he had two mild heart attacks. least been blogging all day today from his detention cell. his lawyer says the heart attacks have not prevented him from blogging, but we don't know why he's in the hospital. what happens now is anyone's guess. this strange movie is far from over. back to you. >> it's going to make a great movie some day. it is unbelievable. >> so bizarre. you know, he's been on the run. now, you know, he's in custody

but with two heart attacks. >> i know he's been at odds with the belize police. if you're innocent, why do you leave the country then? >> that's one of the huge questions here, bill. >> he said they're out to kill him. >> he said they want to kill him. it's retribution for his failure to pay bribes to the belize police. they've take an lot of his workers into custody. some of those workers have the not been seen since then. there are real signs that he could be in danger, but he offered to answer questions by telephone from kwaguatemala to belize police. they say they want him in person. the central question is if he didn't do it, just go in and tell them, give them your alibi and tell them what you know. he hasn't done that yet. >> especially since he has the world's attention right now. >> that's for sure. this dispute with his next door neighbor occurred because

mcafee's dogs, he left them out unleashed at all times, and the neighbor was upset about that. on one particular day, september 9th, i think it was, his dogs, many of them were found dog. they had been poisoned. then two days later, the next door neighbor was found murdered. >> that's right. mcafee said, look, you know, it's clear that he did have disagreements with his neighbor. he said, look, there were six people with mcafee sleeping at his compound the night of the murder. he says, look, i have six witnesses who were with me in my compounds while i was sleeping that night. he has an alibi. meanwhile, mcafee offered a $25,000 reward for finding the real killer here. meantime, there's been a recent picture posted on twitter. it's a little disturbing. it shows mcafee lying in a hospital bed not responding to nurses. so this could get very serious in the coming hours. >> all right. we'll find out. thanks, robert. crazy. heading toward the close.

we have the closing countdown with the dow up almost 40 points now. >> we'll check in with td bank. they're making another big acquisition. the ceo here exclusively to talk about what it means for the bank, whether there's more wheeling and dealing to come. you're watching "the closing bell" on cnbc. first in business worldwide. i always wait until the last minute.

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the french and german stock markets today closed at 52-week highs. look at that. highest they've been all year. our market, not the same. the dow is below the highs that were set back in september. i want to ask michael shay what's holding us back, fiscal cliff or what? >> at this point, we're finally all fiscal cliff. the last two or three weeks has been fiscal cliff. >> would we be higher if we zrpt that distraction? >> i think absolutely. the equity markets would be. i think the bonds market is still pricing in a lot of stress over in europe. that's why you're getting a little bit of this divergence. we talked about this earlier. if you look where sectors are trading right now, after we got the bounce on the 19th, there are several sectors doing far better than where they were on election. >> that's true. you know what? we've been so focused on the fiscal cliff, we haven't thought about the jobs number coming out tomorrow. what do you expect? >> i expect it to be nothing that's going to